Macau Opens Following Coronavirus Shutdown

As the impact of coronavirus is being felt across the world, Asia’s biggest gambling hub in Macau is re-opening for business despite major concerns over public safety. Current levels of infection worldwide are in excess of 100,000, and the death toll is climbing into the low thousands. Macau, which is situated in such close proximity to China is under a high-threat level. Despite this, the local government has announced that the city’s casinos will be open again for business after the virus ban has been lifted.

Casino floor in Macau.

The casino floors of Macau are unlikely to return to the usual hustle and bustle of pre-coronavirus times, despite the ban being lifted by the government this week. It will take some time for public confidence to be restored and normality to return. ©lifeP/Pixabay

The government was rapid in their response against the coronavirus outbreak back in early February. Decisive and rapid action was taken across China, with whole cities being placed into quarantine, industry, production, and manufacturing grinding to a standstill, the authorities were taking no chances.

In Macau, casino bosses were ordered in early February to shut down the industry. This decision followed the announcement that 2 out of the 10 people infected with the virus in Macau had been employees at the casinos. However, on Thursday, following an unprecedented shutdown that has extended past 15 days, the casinos will restart operations and open their doors.

Of course, many restrictions are still being implemented. Most of the city’s entertainment venues, restaurants, bars and cinemas will remain shut during the foreseeable future. At the same time, the casinos will impose strict enforcement of compulsory mask-wearing for all visitors and temperature checking gates at the entrance of the venues.

Huge Financial Hit

There has been a tremendous financial impact in wake of the government enforced shutdown of Macau’s. To add some perspective to the potential losses incurred, Macau is very much a central hub of the wealthy elite gamblers of Asia, and on any given day one can expect to find wealthy punters gambling to astronomical levels of wager.

In 2018, Macau recorded $38bn total revenues as the amount of money bet across the city’s casinos hit historic levels. Along with the loss in revenues, over 8% of the city’s population are employees of the casino industry. With such an integrated dependence on the casinos business for the sustainability of the local economy, an end to the shutdown was highly anticipated as the government tries to kickstart the economic machine.

A government official who is a member of the legislative assembly in Macau, Au Kam-san commented on the suspension being lifted:

Gaming industry is too important to Macau. The government could not afford to let it close for too long. There could also be pressure from the casino operators. Because they are still paying the staff while the casinos are closed.NSW Department of Justice, Court Papers

Another possible threat vector for the Macau gambling sector is the fact that the majority of the casino employees are from the mainland in China. Having to cross the border every day for work, government advice currently states that individuals should take a self-imposed 15-day quarantine. Of course, this implementation will be completely impossible given the immediate need for workers at the casinos in the wake of the long shutdown period.

Some 65,000 cross the border every day to work in the casinos at Macau. With this enormous footfall going back and forward on a daily basis, the containment of the virus will be greatly hindered. To outside commentators, it does appear that the local authorities are ignoring clear health risks to reinvigorate the local economy.

Gambling tourism, which is the foundation of Macau’s wealth, represents more than 50% of the city’s economy. With this scale of dependability, and literally billions of dollars of revenue being squandered each week of closure that passes. It is little surprise that Macau has been aggressively pursuing measures to end the government imposed shutdown of its prime industry.

Sluggish Economic Conditions Expected for Several Months

The recovery of Macau’s gambling economy could be a slow and painful process predicts investors. With the economy fully reliant on gambling revenues, and without adequate diversification to absorb the loss in revenues the previous month has witnessed, recovery is expected to be a slow and sluggish process.

With nearly all of the city’s main casinos including Melco Resorts & Entertainment’s Altira Macau, Hotel President, the Waldo Hotel and the Grand Dragon Casino, all having opened their doors, no one expects things to bounce straight back to normality for some months to come. The immediate conditions for re-opening are already having a considerable negative impact, with limitations on headcounts, standing bets prohibited, and all staff and guests required to wear face masks.

Worst of all still is the negative perception of visiting a public space. Much of China and parts of the Asian world is rapidly isolating themselves, with public gatherings becoming increasingly rare and discouraged by local authorities in an effort to curb the spread of the outbreak.

With anxiety levels at a very high state, it is unlikely that regular visitors of Macau will be rushing back to attend the casinos whilst the number of recorded cases continues to accelerate and increase in an upward trend. Footfalls across the region are expected to continue to remain low until public confidence in the containment of coronavirus is fully restored.

In the meantime, gamblers in Asia have been resorting to the online gambling platforms as a supplement for their needs. Whilst the threat of the virus looms large, the big online platforms are enjoying an increase in activity as the service the existing demand for gambling products in Asia.

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